Sydney Garth, Credit Cards Moderator
A closed account on your credit report is an account that is no longer active, meaning it was either closed upon your request or automatically closed by the creditor after a long period of inactivity.
Loans and refinanced loans are also regarded as accounts and they should appear as closed accounts after they are paid off. Information about closed accounts typically stays on your credit report for 10 years.
We have an article about what information on your credit report means here.
Get Your Free Credit ReportSign Up Now
Lauren Smith, WalletHub Staff Writer
A closed account on your credit report means the account was closed upon your request or the creditor closed it due to a lengthy period of inactivity, late payments or default. Accounts closed in good standing (paid on time and in full) remain on your credit report for up to 10 years. Conversely, accounts closed because of nonpayment fall off your report after 7 years.
If the closed account status is an error, you can file a dispute with the three major credit bureaus. The bureaus should respond within 30 to 45 days.
It is important to note, you should keep lines of credit and credit cards open, even if the account has a $0 balance. By closing these kinds of accounts, you can increase your credit utilization ratio and consequently damage your credit. An ideal credit utilization ratio is 1-10%. You’ll also benefit from having older open accounts.
You can check your credit report for free on WalletHub to see what open and closed accounts are listed there.
People also ask
Did we answer your question?